The weekly AAII bullish and bearish readings are meant to track individual investor sentiment towards the stock market. While bullish sentiment remained low for nearly all of 2017 (as the S&P 500 went up and up and up), it spiked up to the high 50s just as the market was peaking in January. The first 10%+ correction for the S&P 500 since early 2016 ensued, and like clockwork, the AAII bullish reading collapsed back down to the high 20s/low 30s.
AAII surveys individual investors on a weekly basis, and this week the bullish sentiment reading took a very small dip to 31.9%. At the same time, the AAII bearish sentiment ticked up very slightly to 36.64%. Given that sentiment readings are generally viewed as contrarian, it’s bullish to see more bears than bulls.